THE ROLE OF OBASANJO IN THE MAMBILLA CONTRACT
12 February 2024
“Without strong watchdog institutions, impunity becomes the very foundation upon which systems of corruption are built. And if impunity is not demolished, all efforts to bring an end to corruption are in vain” – Rigoberta Menchú, Nobel Prize Laureate
The ongoing back and forth games on the Mambilla Power Project go beyond the superfluous bragging of the former President Olusegun Obasanjo and the demonizing of present and former government officials, or the antics of scaring away citizens with patriotic zeal to serve their fatherland. In retrospect, the public will need to know what happened and how the Mambilla saga started. What exactly was the involvement of former President Olusegun Obasanjo in the Mambilla Power project? Without him, the project would not have seen the light of day, and without him, it would not have been awarded, and without him, the project would not have suffered great setbacks. It is thus pertinent and imperative to delve into deep investigative journalism to shed more light on the failure of the Mambilla Power Project, its connections with the infamous Third Term Agenda and the high-level corruption in the power sector.
Between 2000-2002, in his first term as President, Chief Obasanjo acted as the Chief Promoter of the Mambilla Power Project to be executed with private sector investment as a Build, Operate and Transfer (BOT) contract in which all the funds and investments would be provided through private sector participation. First, Chief Obasanjo redeployed to the Justice Ministry the sitting Minister of Power, Chief Bola Ige, who initially laid out the plans for private sector programme for the Mambilla and other hydroelectric power stations in Nigeria and appointed Dr. Olusegun Agagu as the Minister of Power to replace Chief Bola Ige. He (Chief Obasanjo) took special interests in the power sector and actively encouraged successive Ministers of Power – Dr. Olusegun Agagu, Alhaji Danjuma Goje and Engr. Murtala Aliyu to push the Mambilla Power Project as a BOT contract. As the President, Chief Obasanjo sent the then Vice President, Alh Atiku Abubakar and the then Minister of Power (Engr Murtala Aliyu) and other Government officials to China to ascertain the capabilities and competence of the companies proposed by Sunrise Power and Transmission Company Limited as partners for the construction of the Mambilla Hydroelectric Power Station. When the Vice President led delegation reported positively to the President from China, the President authorised them to sign the fundamental 2002 MOU with the Chinese partners. Upon the return of the delegation to Nigeria, the then vice president, Atiku Abubakar, fully briefed President Obasanjo on the Chinese government’s involvement and the possibility of the project attracting Chinese funds. This led to momentous personal engrossment of Chief Obasanjo who followed up with another presidential visit to China, led by himself and the Minister of Power, Dr Olusegun Agagu to China again in 2002.
Under the former President Obasanjo, the confirmation of the Chinese Government-owned construction companies which partnered with Sunrise in respect of their capacities, competence, and financial resources to execute the Mambilla hydropower project was carried out. The former President also superintended the process which estimated the value of the Mambilla Project at $6 billion, the international bid process, and the interministerial committee processes that fixed the tariff of the electricity to be generated from the hydroelectric dam and the period over which the project would be operated by Sunrise before it would be handed over to the Nigerian government. Chief Obasanjo subsequently gave approval to the former Minister, Dr. Olusegun Agagu in November 2002 on the Mambilla Power Project. President Obasanjo later appointed Dr Olu Agunloye as Minister of Power to replace Dr Agagu who left the Ministry rather abruptly to contest the Ondo State Governorship election. On 28 November 2002, that President Obasanjo appointed Dr Agunloye, he gave him a matching order “to invite Sunrise for final negotiations” and later gave approval to him (Minister Olu Agunloye) in April 2003 to implement the BOT contract on Mambilla Power Project.
In the months of May to August 2003, officials of the Ministry of Power conducted meetings with Sunrise management to finalise the details of the award of the Mambilla Power Project BOT contract as stated in the Minister’s letter of 22 May 2003. They thought the Mambilla project implementation was ready to take off with private sector investment, but they were proved wrong by intrigues of the power play in the Presidency between the top players in government business which had begun to rear its ugly head. Allegations that the then second in command, Alh. Atiku Abubakar had special interests in the Mambilla Power Project had emerged, and the resolve was then aimed at frustrating the Atiku Abubakar’s 2007 presidential ambition. The then Minister of Power, Senator Liyel Imoke, dispatched a letter dated 3 September 2003 to Sunrise to disown the 22 May 2003 BOT Contract, but the Minister did not cancel the contract. The then President, Chief Obasanjo, who had all powers, did not cancel, or revoke the contract either. Messrs Sunrise and their lawyers, Chief Afe Babalola, SAN pointed out to the FGN in writing and at various meetings that the BOT Contract awarded by the Minister of Power in 2003 was legitimate and binding on the FGN.
Through all these and for the next four years, 2003 to 2007, while Chief Obasanjo was on the saddle as President, he looked the other way, pretending not to be aware of the May 2003 BOT contract award. By about mid-2005, when the former president got a confirmation of the China Eximbank interest in the Mambilla Power project, he immediately arranged yet another trip to China. He personally led this trip with the then Ministers of Power, Presidency Officials, the then Governors of Ogun, Osun, and Kwara States and the then National Security Adviser (NSA). At the site of the world famous 3-Gorges Dam in China, the former President Obasanjo publicly, in the presence of all and sundry, declared that the Nigerian Mambilla Hydroelectric Project would be conceded to a Chinese company, named CGC.
On his return from the trip to China, Chief Obasanjo, as sitting President, proceeded to take over all power projects in the country and transferred same to the Presidency. In the same Year 2005, Obasanjo established the Niger Delta Power Holding Company (NDPHC) and proclaimed, through Executive Orders, that all power generation projects including the pending Mambilla Hydroelectric Power Project would from then on be executed through the procurement process and no longer by Build, Operate and Transfer (BOT). In November 2005, the former President Obasanjo enacted the Infrastructure Concession Regulatory Commission Act (ICRC Act 2005) that removed the powers of serving Ministers of the Federal Republic to award contracts without the Federal Executive Council approval suggesting that Chief Obasanjo indeed knew that as of the 2003, the Minister actually had statutory powers to award the Mambilla BOT contract.
In spite of the extant Public Procurement Act, the former President, Chief Olusegun Obasanjo, split the Mambilla Power Project into component parts in 2007 and awarded a component of these as $1.46 billion subcontract to the anointed Chinese company, CGC as a procurement contract on 28 May 2007. He also appointed a senior Presidency Officer as the anchorman to act as the link with CGC. These Chief Obasanjo’s actions and proclamations in the power sector goaded the Yar’Adua and Jonathan Administration to cancel the Chief Obasanjo’s Mambilla Contract of 2007 and later the Administration re-awarded the Mambilla Project to Sunrise in 2012 as a procurement contract. The President Buhari Administration followed suit. It cancelled the Yar’Adua-Jonathan’s Mambilla contract of 2012 and re-awarded the same Mambilla Project to another company in 2017, also as a procurement contract.
It can be seen that the chain of cancellations and re-awarding of same Mambilla Power Project, started by Chief Obasanjo eventually cascaded with ballooning consequences and has finally led Nigeria into a bitter Arbitration process in France with Nigeria now struggling to avoid huge liabilities by pleading pervasive corruption by own Ministers, Attorneys General and Government officials, including denials by Nigerian Presidents and angling to criminalise all Officials involved in the Mambilla project except those that served since the APC Government took over in 2015.
At this point, it is instructive to wind back a little to shed light on what President Yar’Adua did on his assumption of office in May 2007 after Chief Obasanjo had left the presidency. The new President (Alh Yar’Adua) decided to take a critical look at the power sector. He insisted on probity and accountability for all federal government projects, and that things had to take proper procedure and all shoddy dealings in the power sector be stopped. In November 2007, President Yar’Adua instructed the then Honourable Attorney General of the Federation (HAGF), Barrister Michael Aondoakaa, SAN to investigate the process which resulted in Sunrise being awarded the BOT contract in 2003, and the process that resulted in the award of the $1.46 billion subcontract of the Mambilla Project to the Chinese company, CGC. The HAGF confirmed that the tender process by an Inter-Ministerial Tenders Committee under the then Power Minister, Dr. Olusegun Agagu was conducted transparently in 2002 and that the BOT Contract was duly awarded by Dr. Agunloye in May 2003. The Yar’Adua findings also unearthed allegations of bribe paid to a senior official under the Obasanjo Presidency, a revelation that persuaded President Yar’Adua to cancel the $1.46 billion contract to CGC in 2008.
The initial leads to the connection of the Mambilla Power Project intrigues with the Third Term Agenda can be garnered from what Col Dangiwa Umar had to say in his 2009 Essay on “How Obasanjo and Co Looted Nigeria in 8 Years” when he wrote: “But while NEPA was diligently drawing up its plans, President Obasanjo was busy perfecting plan to use the power projects to amass personal fortune. The first of the many dubious projects lined up for this purpose was the Irish generator procurement contract.” Col Umar reported how the Irish Turbine scam was foiled by the then Minister of Power, Chief Bola Ige who checked out the proposed turbines and submitted a damning report that they were not new but in dilapidated forms. Chief Bola Ige was later redeployed to the Ministry of Justice and was assassinated soon after. Chief Obasanjo would later describe Chief Ige as a Minister of Power that “did not know his left from his right.” Perhaps, rightly so, according to Col Umar, because “Chief Bola Ige did not know how to assist the President to steal from the Power Ministry”.
Still in line with the Colonel Umar’s thesis, it was the same Chief Obasanjo, who as President, de-categorised the Mambilla project from being executed as a Build, Operate and Transfer (BOT) contract wherein the contractor finances the project and recovers his investments from operating the hydroelectric dam for 30 to 40 years. Chief Obasanjo re-categorised the Mambilla project as a procurement project to be awarded at $6 billion and be paid for from the $16 billion funding sought and obtained by him (President Obasanjo) for the NDPHC and other power projects in Nigeria. It turned out that the $16 billion project funds were later being alleged by investigations and reports that they were primarily corruptly administered and perhaps intended to finance the Third Term Agenda, hence the active involvement of Presidency officials and favourite participant companies. These allusions are also supported by the Exclusive Power Probe Report under President Yar’Adua by the House of Representatives’ Special Committee on the Power Sector from 2000 to 2007 which roundly indicted former President Olusegun Obasanjo, some of his ministers and several others in the Power Sector.
Ancillary to Obasanjo’s persistence and exception to the positions of law and official opinions of Honourable Attorneys General of the Federation on the Mambilla project over the years during and after his stint as leader of government business became obviously noticed in 2005, when Chief Afe Babalola, SAN wrote the FGN under Obasanjo to say that the Mambilla BOT Contract of May 2003 was legitimate. Chief Obasanjo ignored this and more afterwards. In July 2008, President Yar’Adua instructed his then HAGF, Bar. Michael Aondoakaa to reinstate the Mambilla contract to Sunrise. In 2011 and 2016, HAGF Mohammed Adoke, SAN, and HAGF Abubakar Malami, SAN advised their respective Presidents that the Mambilla BOT contract was legitimate. Renowned lawyers, including Chief Afe Babalola, SAN (2005), Dr. Gbolahan Elias, SAN (2018), Chief Femi Falana, SAN (2020), and recently Chief Wole Olanipekun, SAN (2023) have all confirmed that the 2003 BOT Mambilla contract to Sunrise by Dr Olu Agunloye was duly awarded. These legal luminaries noted that as of 2003, sitting Ministers in Nigeria had statutory authority to award contracts and that the ICRC Act (2005), which later took away this authority, was not made retroactive. Notwithstanding all these, Chief Obasanjo stalled the initial BOT contract Mambilla Power Project, and split this into component parts, reclassified them as procurement contracts and awarded a subcontract to CGC along with other $16 billion failed power projects of 2007.
Under President Buhari regime, the anointed CGC was included in the $5.79 billion procurement contract for Mambilla Hydropower Project awarded in 2017. It was the same Obasanjo’s influence that caused the current Honourable Attorney-General of the Federation, Barrister Lateef Fagbemi, SAN to plead at the ongoing International Arbitration in France that “Chief Olusegun Obasanjo, the president from 2003 to 2007, did not know that his Minister awarded the BOT contract in May 2003 until twenty years after”. It is believed that Chief Obasanjo’s intentions could be aimed at getting a reward/compensation for CGC for its huge investment made towards his Third Term Agenda in 2007, and to restore the $1.46 billion contract CGC Contract which Yar’Adua cancelled in 2008.
Under the Tinubu presidency, Chief Olusegun Obasanjo appears to exert influence on the Hon Attorney General of the Federation, Barr. Lateef Fagbemi who cut his legal teeth under Chief Afe Babalola, a friend and personal lawyer to Chief Obasanjo. What is playing out could be a situation where Chief Obasanjo is influencing or directing the Tinubu’s Attorney General on the Mambilla Power Project through letters and meetings, some of which were made public by Chief Obasanjo himself. Is it not equally amazing that Attorney General Fagbemi himself appears to be corroborating the former President’s position through some of his (Fagbemi’s) actions relating to the International Arbitration case, with or without clearing with his principal, President Tinubu?
The failure of the citizens to stop and or confront frontally the act of corruption in any form, and the people’s indifference to tracking the misdeeds, injustices and aberrations perpetrated by leaders and occupiers of public office can be said to be why selfish leaders continue to think that their personal interest is the collective national interest. What is being witnessed now is because of our failure to interrogate or scrutinise our former public office holders, making them to believe that they hold the ace to hypnotize and manipulate our sensibilities. Take, for example, what Colonel Abubakar D. Umar – former governor of Kaduna State – stated in his book “The Devil Is It, Mr. President”, January 2004, that – “it is now clear that you (Obasanjo) have escaped public scrutiny through misrepresentation, manipulation, and cunning. It will suffice to review your performance as the democratic president between 1999 and 2003 and how you re-emerged in the 2003 elections in order to demonstrate that you derive your inspiration from some other being, which you tragically mistake for the good Lord.” While the Chair of Transparency International, Delia Ferreira noted that “People’s indifference is the best breeding ground for corruption to grow.” These statements further confirm the lethargic nature and forms with which successive governments had been running the system without taking into consideration the adverse consequences of ruining the future of its tomorrow’s stars. Who dares to stand for the future when the prospect is ruined?
Mambilla Collections. www.themambillacollections.com
